Shares at record level again. Is Trump the Reason?

What does a Trump presidency mean for the Fed?

What does a Trump presidency mean for the Fed?

The Dow, S & P 500, Nasdaq and Russell 2000 each reached new highs on Monday.

Investors are dizzy with excitement and they clearly believe that large blue-chip multinationals as well as smaller companies that do most of their business in the United States will continue to do well.

So is this the Donald Trump rally? Or the Janet Yellen rally?

Some strategists believe that Trump's economic plans and the rumor of killing many burdensome regulations are the reasons for the stock's rise.

Or is it better to call the continuation of the Barack Obama rally?

One could argue that POTUS 44 gave POTUS 45 a pretty good hand.

The solid labor market and overall economy that Trump inherited may be why consumers and businesses are so confident.

But investors (and financial journalists) often quickly give the president more credit – and debt – than they are likely to earn for the performance of the stock market.

RBC strategist Jonathan Golub pointed out in a report Monday that aptly titled "Message to Market: It's Not Just About Donald".

Related: Trump does not kill the bull market

Golub noted that the S&P 500 rose nearly 7% from late June to election day – a time when most polls predicted that Hillary Clinton would be the next president.

But stocks have continued to recover since then, gaining another 8% since Trump's angry victory (at least in the mainstream media and on Wall Street).

You can't have it both ways. It makes no logical sense to say that stocks recovered because investors believed Trump would lose, and that they continued to recover because Trump did not lose.

Since Trump's win, bond yields have also risen, a phenomenon that many investors have attributed to the likelihood of incentives from the President and the Republican Congress.

However, Golub points out that the yield of the ten-year US Treasury also increased in late summer.

Of course, many investors also expected impulses from Clinton.

Once again, many investors claim that Trump is the trigger for something that not only happened before his election but also happened because many thought he was going to lose.

Related: Shares avoided a 1% dive over an unusually long period

So it's strange that Trump is cited as the main reason for a market rally that began months before anyone felt they could win.

What's really going on The only constant in recent months is the Federal Reserve.

Yes. The markets are reacting to Washington. But they pay more attention to Janet Yellen than to the White House.

The Fed made it crystal clear before the election that it is likely to raise rates in December, a couple more times in 2017, regardless of who won the presidential race.

The good news for investors is that the US economy appears to be growing steadily, but there is no risk of overheating.

Related: Here's Why The World's Greatest Money Manager Is Worried

The latest employment report showed that wages grew at a reasonable rate of 2.5% annually. However, this is far from high enough to trigger fears of out-of-control inflation and prompt the Fed to aggressively raise rates.

Even if Yellen and the Fed raise rates three times this year, it should only be a quarter of a point each time. This would push the Fed's short-term base rate to a range of 1.25% to 1.5%.

That is still extremely low. At these levels, stocks would still be more attractive than bonds. Corporate earnings should continue to grow at a healthy level. And consumers would probably continue to spend.

Investors should therefore keep an eye on Yellen and not just focus on the president for a short time.

For this reason, Yellen will testify before the congress on Tuesday and Wednesday. And what she says about the timing and extent of future rate hikes could cause the rally to continue at full speed – or to stop completely.

CNNMoney (New York) First published February 13, 2017: 12.30 p.m. ET